Earlier this month, the proclamation that “4 in 5 Employees Want Benefits or Perks More Than a Pay Raise” headlined Glassdoor’s release of its Q3 2015 Employment Confidence Survey.
Responses to the headline were a mixed bag. But once you dive into the numbers a little deeper and pick up some context, you can start to connect the dots. Then, the idea that better benefits could be more important than pay raises seems a bit less radical and a bit more realistic.
So how valuable are employee benefits really? Let’s break it down a bit.
Glassdoor at a Glance
So the first fallacy is the “4 in 5 Employees” result. More like nearly four out of five employees – 79 percent of employees, in fact – would prefer new or additional benefits to pay increase, according to the Employment Confidence Survey. The numbers skewed slightly higher for women than men (82 percent compared to 76 percent) and for younger employees (89 percent of employees aged 18-34 compared with 66 percent of those aged 55-64).
Then, once you look at the actual employee benefits and perks that employees are most likely to value more than pay raises, it becomes clear that most of these benefits impact employees’ wallets about as directly as a pay raise would.
The Top 5? Healthcare insurance, vacation/paid time off, performance bonuses, paid sick days and 401(k), retirement or pension plans. These aren’t foosball tables and bring-your-dog-to-work days they’re talking about. These are benefits that directly affect employees’ quality of life.
An HR Perspective
From a talent perspective, employees are more confident in the job market than they’ve been in recent years. In this “buyer’s market,” companies are competing for the best workers out there, and employee benefits and work-life balance are taking center stage.
From an employer’s perspective, work-life benefits are becoming increasingly essential recruiting and retention tools. According to a recent survey by the Society for Human Resource Management, 38 percent of employers are leveraging benefits for recruitment purposes and 33 percent used benefits as a retention strategy. In both cases, that’s a double-digit increase from 2013, when the numbers were 26 percent and 18-20 percent, respectively.
The SHRM report connects the surge in leveraging employee benefits for recruiting and retention with the fierce competition for talent at a time when there isn’t a huge amount of growth in base salaries. So, as wages stagnate, is it that unrealistic to think employees would value better benefits over a nominal pay raise?
Though they rank fairly low on Glassdoor’s list of benefits and perks preferred over pay raises, work-life benefits such as paid parental leave and child care assistance have seen their profile increase in recent years.
Following a summer in which company after company announced expanded paid parental leave programs, we saw paid leave featured prominently in the recent Democratic presidential debate. And the cost of child care was a hot topic of conversation following a recent report by the Economic Policy Institute that found child care costs more than in-state undergraduate tuition at a 4-year public institution.
In general, the struggles of America’s working families have been well catalogued recently. The divide between the way our modern families work and live and the policies in place to support them – both at work and outside of it – is significant and the desire for change is nearing critical mass.
So, could it be true that employees would prioritize better benefits and work-life balance over a raise in their pay check? Maybe.
Don't believe us? Just look at what Paul Ryan is saying about the House Speaker gig.
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